Assertio Therapeutics, Inc. (NASDAQ: ASRT) today reported financial
results for the quarter ended March 31, 2019, and provided an
update on its business performance and strategic initiatives.
First-Quarter Financial
Highlights:(unaudited)
|
First-Quarter 2019 |
(in millions, except earnings per share) |
GAAP |
Non-GAAP(1) |
Total Revenues |
$57.9 |
$59.7 |
Net Income/(Loss) |
$(14.3) |
$17.6 |
Earnings/(Loss) Per Share |
$(0.22) |
$0.23 |
Adjusted EBITDA |
- |
$36.4 |
(1) All non-GAAP measures included in this earnings release are
reconciled to the corresponding GAAP measures in the schedules
attached.
“We’re off to a strong start to the year,” said Arthur Higgins,
President and CEO of Assertio. “We continue to drive better
performance from our business as we remain focused on operating
efficiencies and improving momentum in our Neurology Franchise net
sales. As a result of our strong start, today we are raising our
adjusted EBITDA guidance range.”
Business Highlights:
- Favorable NUCYNTA® Patent
Ruling: On March 28, 2019, the Company announced that the
United States Court of Appeals for the Federal Circuit ruled in
favor of Assertio with respect to the Company’s patent litigation
against three filers of Abbreviated New Drug Applications (ANDAs)
for the NUCYNTA franchise. The Federal Circuit’s ruling affirms the
decision of the United States District Court (D.N.J.), which found
U.S. patent No. 7,994,364 (the ’364 Patent) to be valid and
infringed by the defendants. The ’364 Patent covers the entire
NUCYNTA franchise until December 2025.* The NUCYNTA franchise
is commercialized by Collegium Pharmaceutical, Inc. (Collegium).
The Company receives royalties from Collegium based on net sales of
the franchise.*Patent expiration dates reflect the addition of six
months of pediatric patent term extension Assertio anticipates
securing from the United States Food and Drug Administration.
- FDA Accepted Filing of 505(b)(2) NDA Filing for
Cosyntropin: On February 19, 2019, the Company received
notification of acceptance for filing from the U.S. Food and Drug
Administration for its 505(b)(2) New Drug Application for its
injectable formulation of long-acting cosyntropin (synthetic
adrenocorticotropic hormone, or ACTH). The Company, together with
its partner, West Therapeutic Development, LLC, seeks approval for
the use of long-acting cosyntropin as a diagnostic drug in the
screening of patients presumed to have adrenocortical
insufficiency.
- Amended Senior Secured Credit Facility: On
January 8, 2019, the Company amended its Senior Secured Credit
Facility, replacing the previous fixed adjusted EBITDA covenant
with a trailing 12-month debt-to adjusted EBITDA ratio that
declines over time as we make scheduled principal payments. The
amendment gives the Company greater flexibility to continue to pay
down debt and invest in the core business, including potential
business development transactions.
- Debt Reduction and Cash Position: On January
15 and April 15, 2019, the Company made scheduled principal
repayments of $25.0 million and $55.0 million, respectively,
reducing the Company’s secured debt to $202.5 million as of today’s
date. On January 30, 2019, the Company received $32.0 million,
the balance of a $62.0 million patent litigation settlement
announced in the third quarter of 2018. As of March 31, 2019, the
Company had cash and cash equivalents of $109.7 million.
Revenue Summary:(in thousands, unaudited)
|
Three Months Ended March 31, |
|
2019 |
|
2018 |
Product sales, net: |
|
|
|
Gralise |
$ |
13,278 |
|
|
$ |
14,827 |
|
CAMBIA |
8,808 |
|
|
6,416 |
|
Zipsor |
4,231 |
|
|
4,746 |
|
Total neurology product sales, net |
26,317 |
|
|
25,989 |
|
|
|
|
|
Nucynta products |
62 |
|
|
18,145 |
|
Lazanda |
71 |
|
|
220 |
|
Total product sales, net |
26,450 |
|
|
44,354 |
|
|
|
|
|
Commercialization
agreement: |
|
|
|
Commercialization rights and facilitation services, net |
30,856 |
|
|
28,095 |
|
Revenue from transfer of inventory |
— |
|
|
55,705 |
|
Royalties and milestone
revenue |
623 |
|
|
250 |
|
|
|
|
|
Total
revenues |
$ |
57,929 |
|
|
$ |
128,404 |
|
2019 Financial Guidance:
The Company is raising its previous 2019 earnings guidance range
and confirming its previous Neurology Franchise net sales
guidance:
|
Prior 2019 Guidance |
Current 2019 Guidance |
Neurology Franchise Net Sales |
Low to Mid-Single Digit Growth |
Low to Mid-Single Digit Growth |
GAAP Net Loss(1)(2) |
($71) to ($61) million |
($68) to ($58) million |
Non-GAAP Adjusted EBITDA(1)(2) |
$115 to $125 million |
$118 to $128 million |
(1) Guidance includes $2.8 million of non-cash Collegium warrant
related income.(2) Guidance excludes any future mark-to-market
adjustments, which cannot be estimated.
Conference Call and Webcast:Assertio will host
a conference call today, Wednesday, May 8, 2019 beginning at 4:30
p.m. ET to discuss its results. This event can be accessed in three
ways:
- From the Assertio website: http://investor.assertiotx.com.
Please access the website 15 minutes prior to the start of the
call to download and install any necessary audio software.
- By telephone: Participants can access the call by dialing (877)
550-3745 (United States) or (281) 973-6277 (International)
referencing Conference ID 5347358.
- By replay: A replay of the webcast will be located under the
Investor Relations section of Assertio’s website approximately two
hours after the conclusion of the live call.
About Assertio Therapeutics, Inc.Assertio
Therapeutics is committed to providing responsible solutions to
advance patient care in the Company’s core areas of neurology,
orphan and specialty medicines. Assertio currently markets three
FDA-approved products and continues to identify, license and
develop new products that offer enhanced options for patients that
may be under served by existing therapies. To learn more about
Assertio, visit www.assertiotx.com.
“Safe Harbor” Statement under the Private Securities
Litigation Reform Act of 1995This news release contains
forward-looking statements. These statements involve inherent risks
and uncertainties that could cause actual results to differ
materially from those projected or anticipated, including risks
related to regulatory approval and clinical development of
long-acting cosyntropin, expectations regarding royalties to be
received based on sales of NUCYNTA and NUCYNTA ER, expectations
regarding potential business opportunities and other risks outlined
in the Company’s public filings with the Securities and Exchange
Commission, including the Company’s most recent annual report on
Form 10-K and subsequent Quarterly Reports on Form 10-Q. All
information provided in this news release speaks as of the date
hereof. Except as otherwise required by law, the Company undertakes
no obligation to update or revise its forward-looking
statements.
Investor and Media Contact:John B. ThomasSenior
Vice President, Investor Relations and Corporate
Communicationsjthomas@assertiotx.com
Non-GAAP Financial MeasuresTo supplement the
Company’s financial results presented on a U.S. generally accepted
accounting principles (GAAP) basis, the Company has included
information about non-GAAP revenue, non-GAAP adjusted earnings,
non-GAAP adjusted diluted earnings per share, non-GAAP adjusted
EBITDA and other non-GAAP financial measures as useful operating
metrics. The Company believes that the presentation of these
non-GAAP financial measures, when viewed with results under GAAP
and the accompanying reconciliation, provides supplementary
information to analysts, investors, lenders, and the Company’s
management in assessing the Company’s performance and results from
period to period. The Company uses these non-GAAP measures
internally to understand, manage and evaluate the Company’s
performance, and in part, in the determination of bonuses for
executive officers and employees. These non-GAAP financial measures
should be considered in addition to, and not a substitute for, or
superior to, net income or other financial measures calculated in
accordance with GAAP. Non-GAAP financial measures used by us may be
calculated differently from, and therefore may not be comparable
to, non-GAAP measures used by other companies.
Specified ItemsNon-GAAP measures presented
within this release exclude specified items. The Company considers
specified Items to be significant income/expense items not
indicative of current operations, including the related tax effect.
Specified items include non-cash adjustment to Collegium agreement
revenue and cost of sales, release of NUCYNTA and Lazanda sales
reserves for products the Company is no longer selling, interest
income, interest expense, amortization, acquired in-process
research and development and non-cash adjustments related to
product acquisitions, stock-based compensation expense, non-cash
interest expense related to debt, depreciation, taxes, transaction
costs, CEO transition, restructuring costs, adjustments to net
sales related to reserves recorded prior to the Company’s exit of
opioid commercialization activities, legal costs and expenses
incurred in connection with opioid-related litigation,
investigations and regulations pertaining to the company’s
historical commercialization of opioid products, certain types of
legal settlements, disputes, fees and costs, and to adjust for the
tax effect related to each of the non-GAAP adjustments.
CONSOLIDATED STATEMENTS OF
OPERATIONS(in thousands, except per share
amounts)(unaudited)
|
Three Months Ended March 31, |
|
2019 |
|
2018 |
|
(unaudited) |
Revenues: |
|
|
|
Product sales, net |
$ |
26,450 |
|
|
$ |
44,354 |
|
Commercialization agreement, net |
30,856 |
|
|
83,800 |
|
Royalties and milestones |
623 |
|
|
250 |
|
Total revenues |
57,929 |
|
|
128,404 |
|
|
|
|
|
Costs and expenses: |
|
|
|
Cost of sales (excluding amortization of intangible assets) |
2,575 |
|
|
12,044 |
|
Research and development expenses |
1,793 |
|
|
1,528 |
|
Selling, general and administrative expenses |
25,045 |
|
|
29,033 |
|
Amortization of intangible assets |
25,444 |
|
|
25,444 |
|
Restructuring charges |
— |
|
|
9,017 |
|
Total costs and expenses |
54,857 |
|
|
77,066 |
|
|
|
|
|
Income from operations |
3,072 |
|
|
51,338 |
|
Interest income and other
(expense) income, net |
(609 |
) |
|
229 |
|
Interest (expense) |
(16,554 |
) |
|
(18,068 |
) |
Income taxes (expense)
benefit |
(210 |
) |
|
325 |
|
Net (loss) income |
$ |
(14,301 |
) |
|
$ |
33,824 |
|
|
|
|
|
Basic net (loss) income per
share |
$ |
(0.22 |
) |
|
$ |
0.53 |
|
Diluted net (loss) income per
share |
$ |
(0.22 |
) |
|
$ |
0.48 |
|
Shares used in computing basic
net (loss) income per share |
64,239 |
|
|
63,503 |
|
Shares used in computing
diluted net (loss) income per share |
64,239 |
|
|
81,877 |
|
CONSOLIDATED CONDENSED BALANCE
SHEETS(in
thousands)(unaudited)
|
March 31, 2019 |
|
December 31, 2018 |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
$ |
109,691 |
|
|
$ |
110,949 |
|
Accounts receivable, net |
43,488 |
|
|
37,211 |
|
Inventories, net |
3,077 |
|
|
3,396 |
|
Property and equipment, net |
16,625 |
|
|
13,064 |
|
Intangible assets, net |
666,655 |
|
|
692,099 |
|
Investments |
10,362 |
|
|
11,784 |
|
Prepaid and other assets |
33,566 |
|
|
64,363 |
|
Total assets |
$ |
883,464 |
|
|
$ |
932,866 |
|
|
|
|
|
Accounts payable |
$ |
5,421 |
|
|
$ |
6,138 |
|
Interest payable |
8,794 |
|
|
11,645 |
|
Accrued liabilities |
19,976 |
|
|
31,361 |
|
Accrued rebates, returns and
discounts |
71,655 |
|
|
75,759 |
|
Senior notes |
251,418 |
|
|
278,309 |
|
Convertible notes |
292,604 |
|
|
287,798 |
|
Contingent consideration
liability |
1,066 |
|
|
1,038 |
|
Other liabilities |
23,985 |
|
|
20,483 |
|
Shareholders’ equity |
208,545 |
|
|
220,335 |
|
Total liabilities and shareholders’ equity |
$ |
883,464 |
|
|
$ |
932,866 |
|
RECONCILIATION OF GAAP NET INCOME (LOSS)
TO NON-GAAP ADJUSTED EBITDA(in
thousands)(unaudited)
|
Three Months Ended March 31, |
|
2019 |
|
2018 |
|
(unaudited) |
|
|
|
|
|
|
|
|
GAAP net (loss)/income |
$ |
(14,301 |
) |
|
$ |
33,824 |
|
Commercialization agreement revenues (1) |
1,930 |
|
|
(52,486 |
) |
Commercialization agreement cost of sales (2) |
— |
|
|
6,200 |
|
Nucynta sales reserve (3) |
— |
|
|
(10,711 |
) |
Nucynta and Lazanda revenue reserves (4) |
(133 |
) |
|
— |
|
Expenses for opioid-related litigation, investigations and
regulations (5) |
2,500 |
|
|
1,076 |
|
Intangible amortization related to product acquisitions |
25,444 |
|
|
25,444 |
|
Contingent consideration related to product acquisitions |
— |
|
|
(202 |
) |
Stock-based compensation |
2,702 |
|
|
1,976 |
|
Interest and other income |
(501 |
) |
|
(94 |
) |
Interest expense |
16,554 |
|
|
18,015 |
|
Depreciation |
337 |
|
|
1,475 |
|
Income taxes (expense) benefit |
210 |
|
|
(325 |
) |
Restructuring and related costs (6) |
— |
|
|
8,330 |
|
Other costs |
— |
|
|
362 |
|
Change in fair value of warrants |
$ |
1,629 |
|
|
$ |
— |
|
Non-GAAP adjusted EBITDA |
$ |
36,371 |
|
|
$ |
32,884 |
|
(1) For the period from January 8, 2018 through November 8,
2018, the adjustment relates to the non-cash value assigned to
inventory transferred to Collegium. As of the date of the
amendment, on November 8, 2018, the Company ceased recognition of
fixed revenues and began the recognition of variable revenues when
they become due beginning in January 2019. The adjustment for
the three months ended March 31, 2019 relates to non-cash expense
for third-party royalties, which are expected to have no net impact
for the full year period, as well as the amortization of the
contract asset.
(2) Represents the cash received for inventory transferred to
Collegium at the commencement of the Commercialization
Agreement.
(3) Represents a $12.5 million benefit related to the release of
sales reserves for which the Company is no longer financially
responsible, net of $1.8 million in royalties payable to a third
party during the three months ended March 31, 2018.
(4) Removal of the impact of revenue adjustment estimates
related to products that we are no longer commercializing.
(5) Legal costs/expenses related to opioid-related litigation,
investigations and regulations pertaining to the Company’s
historical commercialization of opioid products.
(6) Restructuring and other costs represents non-recurring costs
associated with the Company’s restructuring, reincorporation,
headquarters relocation and CEO transition.
RECONCILIATION OF GAAP NET INCOME/(LOSS)
TO NON-GAAP ADJUSTED EARNINGS(in thousands, except
per share amounts)(unaudited)
|
Three Months Ended March 31, |
|
2019 |
|
2018 |
|
(unaudited) |
|
|
|
|
|
|
|
|
GAAP net (loss)/income |
$ |
(14,301 |
) |
|
$ |
33,824 |
|
Commercialization agreement revenues (1) |
1,930 |
|
|
(52,486 |
) |
Commercialization agreement cost of sales (2) |
— |
|
|
6,200 |
|
Nucynta sales reserve (3) |
— |
|
|
(10,711 |
) |
Nucynta and Lazanda revenue reserves (4) |
(133 |
) |
|
— |
|
Expenses for opioid-related litigation, investigations and
regulations (5) |
2,500 |
|
|
1,076 |
|
Intangible amortization related to product acquisitions |
25,444 |
|
|
25,444 |
|
Contingent consideration related to product acquisitions |
— |
|
|
(202 |
) |
Stock-based compensation |
2,702 |
|
|
1,976 |
|
Restructuring and related costs (6) |
— |
|
|
8,330 |
|
Non-cash interest expense on debt |
6,164 |
|
|
5,418 |
|
Other income (expenses) |
(332 |
) |
|
— |
|
Change in fair value of warrants |
1,629 |
|
|
— |
|
Income tax effect of non-GAAP adjustments (7) |
(8,039 |
) |
|
3,616 |
|
Non-GAAP adjusted
earnings |
$ |
17,564 |
|
|
$ |
22,485 |
|
Add interest expense of
convertible debt, net of tax (8) |
1,703 |
|
|
1,703 |
|
Numerator |
$ |
19,267 |
|
|
$ |
24,188 |
|
Shares used in calculation
(8) |
82,170 |
|
|
81,877 |
|
Non-GAAP adjusted diluted
earnings per share |
$ |
0.23 |
|
|
$ |
0.30 |
|
(1) For the period from January 8, 2018 through November 8,
2018, the adjustment relates to the non-cash value assigned to
inventory transferred to Collegium. As of the date of the
amendment, on November 8, 2018, the Company ceased recognition of
fixed revenues and will begin recognition of variable revenues when
they become due beginning in January 2019. The adjustment for the
three months ended March 31, 2019 relates to non-cash expense for
third-party royalties, which are expected to have no net impact for
the full year period, as well as the amortization of the contract
asset.
(2) Represents the cash received for inventory transferred to
Collegium at the commencement of the Commercialization
Agreement.
(3) Represents a $12.5 million benefit related to the
release of sales reserves for which the Company is no longer
financially responsible, net of $1.8 million in royalties payable
to a third party during the three months ended March 31, 2018.
(4) Removal of the impact of revenue adjustment estimates
related to products that we are no longer commercializing.
(5) Legal costs/expenses related to opioid-related
litigation, investigations and regulations pertaining to the
Company’s historical commercialization of opioid products.
(6) Restructuring and other costs represents non-recurring costs
associated with the Company’s restructuring, reincorporation,
headquarters relocation and CEO transition.
(7) Calculated by taking the pre-tax non-GAAP adjustments
and applying the statutory tax rate.
(8) The Company uses the if-converted method to compute
diluted earnings per share with respect to its convertible
debt.
RECONCILIATION OF GAAP NET INCOME (LOSS)
PER SHARE TONON-GAAP ADJUSTED EARNINGS PER
SHARE(unaudited)
|
Three Months Ended March 31, |
|
2019 |
|
2018 |
|
|
|
|
|
|
|
|
GAAP net income/(loss) per
share |
$ |
(0.22 |
) |
|
$ |
0.48 |
|
Conversion from basic shares to diluted shares |
0.05 |
|
|
(0.06 |
) |
Commercialization agreement revenues |
0.02 |
|
|
(0.64 |
) |
Commercialization agreement cost of sales |
— |
|
|
0.07 |
|
Nucynta sales reserve |
— |
|
|
(0.13 |
) |
Non-cash interest expense on debt |
0.08 |
|
|
0.07 |
|
Nucynta and Lazanda revenue reserves |
— |
|
|
— |
|
Expenses for opioid-related litigation, investigations and
regulations |
0.03 |
|
|
0.02 |
|
Intangible amortization related to product acquisitions |
0.31 |
|
|
0.31 |
|
Contingent consideration related to product acquisitions |
— |
|
|
— |
|
Stock based compensation |
0.03 |
|
|
0.02 |
|
Restructuring and related costs |
— |
|
|
0.10 |
|
Change in fair value of warrants |
0.02 |
|
|
$ |
— |
|
Income tax effect of non-GAAP adjustments |
(0.11 |
) |
|
0.04 |
|
Add interest expense of convertible debt, net of tax |
0.02 |
|
|
0.02 |
|
Non-GAAP adjusted diluted
earnings per share |
$ |
0.23 |
|
|
$ |
0.30 |
|
RECONCILATIONS OF GAAP REPORTED TO
NON-GAAP ADJUSTED INFORMATIONFor the three months
ended March 31, 2019(in
thousands)(unaudited)
|
|
Commercialization agreement revenues |
|
Product Sales |
|
Royalties and milestones |
|
Cost of sales |
|
Research and development expense |
|
Selling, general and administrative expense |
|
Amortization of intangible assets |
|
Interest expense |
|
Other Income |
|
Provision for (benefit from) income taxes |
GAAP as reported |
|
$ |
30,856 |
|
|
$ |
26,450 |
|
|
$ |
623 |
|
|
$ |
2,575 |
|
|
$ |
1,793 |
|
|
$ |
25,045 |
|
|
$ |
25,444 |
|
|
$ |
(16,554 |
) |
|
$ |
(609 |
) |
|
$ |
(210 |
) |
Commercialization agreement revenues and cost of sales |
|
1,930 |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
Third party royalties |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
Nucynta sales reserve |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
Non-cash interest expense on debt |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
6,164 |
|
|
— |
|
|
— |
|
Nucynta and Lazanda revenue reserves |
|
— |
|
|
(133 |
) |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
Expenses for opioid-related litigation, investigations and
regulations |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(2,500 |
) |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
Intangible amortization related to product acquisitions |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(25,444 |
) |
|
— |
|
|
— |
|
|
— |
|
Contingent consideration related to product acquisitions |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
Stock based compensation |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(273 |
) |
|
(2,429 |
) |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
Restructuring and other costs |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
Change in fair value of warrants |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
1,629 |
|
|
— |
|
Other income (expense) |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(332 |
) |
|
— |
|
Income tax effect of non-GAAP adjustments |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(8,039 |
) |
Non-GAAP adjusted |
|
$ |
32,786 |
|
|
$ |
26,317 |
|
|
$ |
623 |
|
|
$ |
2,575 |
|
|
$ |
1,520 |
|
|
$ |
20,116 |
|
|
$ |
— |
|
|
$ |
(10,390 |
) |
|
$ |
688 |
|
|
$ |
(8,249 |
) |
RECONCILATIONS OF GAAP REPORTED TO
NON-GAAP ADJUSTED INFORMATIONFor the three months
ended March 31, 2018(in
thousands)(unaudited)
|
|
Commercialization agreement revenues |
|
Product Sales |
|
Cost of sales |
|
Research and development expense |
|
Selling, general and administrative expense |
|
Restructuring Charges |
|
Amortization of intangible assets |
|
Interest expense |
|
Benefits from (provision for) income taxes |
GAAP as reported |
|
$ |
83,800 |
|
|
$ |
44,354 |
|
|
$ |
12,044 |
|
|
$ |
1,528 |
|
|
$ |
29,033 |
|
|
$ |
9,022 |
|
|
$ |
25,444 |
|
|
$ |
(18,068 |
) |
|
$ |
325 |
|
Non-cash adjustment to commercial agreement revenues and cost of
sales(1) |
|
(52,486 |
) |
|
— |
|
|
(6,200 |
) |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
Release of NUCYNTA sales reserves(2) |
|
— |
|
|
(12,455 |
) |
|
(1,744 |
) |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
Expenses for opioid-related litigation, investigations and
regulations |
— |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(1,076 |
) |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
Non-cash interest expense on debt |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
5,418 |
|
|
— |
|
Intangible amortization related to product acquisitions |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(25,444 |
) |
|
— |
|
|
— |
|
Contingent consideration related to product acquisitions |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
242 |
|
|
— |
|
|
— |
|
|
40 |
|
|
— |
|
Stock based compensation |
|
— |
|
|
— |
|
|
(14 |
) |
|
(53 |
) |
|
(1,909 |
) |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
Restructuring and other costs(3) |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
691 |
|
|
(9,022 |
) |
|
— |
|
|
— |
|
|
— |
|
Income tax effect of non-GAAP adjustments |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
3,616 |
|
Non-GAAP adjusted |
|
$ |
31,314 |
|
|
$ |
31,899 |
|
|
$ |
4,086 |
|
|
$ |
1,475 |
|
|
$ |
26,981 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
(12,610 |
) |
|
$ |
3,941 |
|
(1) Adjustment for the non-cash value assigned to inventory
transferred to Collegium.(2) $12.5 million benefit from the release
of sales reserves for which the Company is no longer financially
responsible, net of $1.7 million in royalties payable to
Grunenthal.(3) Restructuring and other costs represents
non-recurring costs associated with the Company’s restructuring,
headquarters relocation and CEO transition.
RECONCILIATION OF GAAP NET INCOME (LOSS)
TO NON-GAAP ADJUSTED EBITDAROLLING TWELVE
MONTHS(unaudited)
The below reconciliation is presented to disclose the
calculation of Adjusted EBITDA (as defined in our Senior Notes) on
a rolling 12 month basis to support covenant compliance for our
Senior Notes.
|
Twelve Month Period |
|
Ended March 31, 2019 |
|
(unaudited) |
GAAP net (loss)/income |
$ |
(11,217 |
) |
Commercialization agreement
revenues (1) |
29,252 |
|
Nucynta and Lazanda revenue
reserves (2) |
(1,695 |
) |
Expenses for opioid-related
litigation, investigations and regulations (3) |
9,321 |
|
Intangible amortization
related to product acquisitions |
101,774 |
|
Contingent consideration
related to product acquisitions |
(313 |
) |
Stock-based compensation |
11,165 |
|
Purdue Litigation |
(62,000 |
) |
Interest and other income |
(1,604 |
) |
Interest expense |
67,420 |
|
Depreciation |
793 |
|
Income taxes (expense)
benefit |
1,602 |
|
Restructuring and related
costs (4) |
12,934 |
|
Other costs |
(239 |
) |
Fair value for warrants |
1,629 |
|
Adjusted EBITDA |
$ |
158,822 |
|
(1) For the period from January 8, 2018 through November 8,
2018, the adjustment relates to the non-cash value assigned to
inventory transferred to Collegium. As of the date of the
amendment, on November 8, 2018, the Company ceased recognition of
fixed revenues and began the recognition of variable revenues when
they become due beginning in January 2019. The adjustment for
the three months ended March 31, 2019 relates to non-cash expense
for third-party royalties, which are expected to have no net impact
for the full year period, as well as the amortization of the
contract asset.
(2) Removal of the impact of revenue adjustment estimates
related to products that we are no longer commercializing.
(3) Legal costs/expenses related to opioid-related litigation,
investigations and regulations pertaining to the Company’s
historical commercialization of opioid products.
(4) Restructuring and other costs represents non-recurring costs
associated with the Company’s restructuring, reincorporation,
headquarters relocation and CEO transition.
FIRST-QUARTER RECONCILIATION OF GAAP to
NON-GAAP REVENUES(in
thousands)(unaudited)
|
Three Months
Ended March31, |
|
|
2019 |
|
2018(1) |
Total revenues (GAAP basis) |
$ |
57.9 |
|
|
$ |
128.4 |
|
Non-cash adjustment to
commercialization agreement revenues(2) |
|
1.8 |
|
|
|
(52.5 |
) |
Release of NUCYNTA
sales reserves(3) |
|
— |
|
|
|
(12.5 |
) |
Total revenues (non-GAAP basis) |
$ |
59.7 |
|
|
$ |
63.5 |
|
(1) First quarter 2018 total GAAP revenues include one-time
items described in our quarterly report on Form 10-Q for the fiscal
period ended March 31, 2018.
(2) The adjustment for the three months ended March 31, 2019
relates to non-cash adjustments for third-party royalties, which
were an expense in Q1 2019 but are expected to have no net impact
for the full year period, the amortization of the contract asset,
and the impact of revenue adjustment estimates related to products
that we are no longer commercializing. For the three months ended
March 31, 2018 the adjustment relates to the non-cash value
assigned to inventory transferred to Collegium.
(3) $12.5 million benefit from the release of sales reserves for
which the Company is no longer financially responsible.
FULL-YEAR 2019 NON-GAAP GUIDANCE
RECONCILATION(in
millions)(unaudited)
|
Earnings (1) |
|
Low End |
High End |
GAAP |
|
$ |
(68 |
) |
|
$ |
(58 |
) |
Specified
Items(2) |
|
$ |
186 |
|
|
$ |
186 |
|
Non-GAAP |
|
$ |
118 |
|
|
$ |
128 |
|
(1) GAAP net income guidance refers to GAAP net income and
non-GAAP earnings guidance refers to non-GAAP adjusted EBITDA.
(2) For purposes of this forward-looking reconciliation, a
description of the categories of specified items included in this
reconciliation are detailed in the tables above.
Assertio (NASDAQ:ASRT)
Historical Stock Chart
From Aug 2024 to Sep 2024
Assertio (NASDAQ:ASRT)
Historical Stock Chart
From Sep 2023 to Sep 2024